Rift threatens historic alliance
Johannesburg - Deep divisions between South Africa's ruling ANC and its labour and communist allies are threatening a decades-old alliance as rival factions battle for power and influence to shape policy.
The African National Congress and labour federation Cosatu are embroiled in their biggest public fight since President Jacob Zuma came to power in May last year with the backing of labour and the South African Communist Party.
At stake is the power to change economic policy and considerable say over who will become the next leader of the ANC in 2012, and by implication the country's next president. "It is really going down to the wire. The party is over," said independent political analyst Nick Borain.
The leftists had hoped Zuma would increase spending and do more to help workers and the poor after they helped him win election, but there has been little shift in policies long supported by business for maintaining financial stability.
Tensions in the struggle over the alliance, still dominated by the nationalist party that led the struggle to end apartheid, have come to the boil with both sides launching public attacks.
That infighting is likely to escalate ahead of the ANC's national general council in September.
The ANC accuses its ally of becoming an opponent. Cosatu says the ruling party only cares about pleasing markets.
"For me it is completely virgin territory. The ANC responding to Cosastu was not just an escalation. It was a statement of opposition to each other," Borain said.
Cosatu wants lower interest rates and an end to the central bank's policy of targeting a specific limit to inflation. It has demanded an audit of the lifestyles of ANC politicians amid growing accusations of corruption in the party.
The union federation has also threatened to bring forward strikes against power price increases, although it has stopped short of threatening to disrupt the soccer World Cup in just under three months, South Africa's showcase to the world.
The alliance has held together since the 1950s although Cosatu was sidelined during the presidency of former President Thabo Mbeki. That rift was only patched up when Zuma took over as ANC leader in late 2007.
Markets might feel more comfortable to see the leftists being pushed back to the margins and away from policy making, but a noisy political battle being taken to the streets could push sentiment in the other direction.
Battle to the streets
Analysts said the discord may lead Cosatu to mobilise demonstrations to strengthen its position.
Those could only fuel a climate of unease at a time of spreading protests in townships over the government's failure to deliver on promises of decent homes, schools, roads and water supplies more than 15 years after the end of apartheid.
"This is the most serious public spat between the alliance partners since Zuma's inauguration and deals a severe blow to the tripartite alliance relations," said Anne Fruehauf, Southern Africa analyst at Control Risks.
"Having felt sidelined during the Mbeki era, the unions are extremely sensitive about seeing their demands marginalised once again. With a perceived loss of power in the corridors of power, we could increasingly see Cosatu take the battle to the streets," she added.
The ANC on the other hand seems to be using firebrand youth league leader Julius Malema - who demands mine nationalisation and has not shied from racial rhetoric - to build support among South Africa's millions of poor and unemployed youths.
Malema has attacked Cosatu secretary general Zwelinzima Vavi, who has expressed interest in an ANC leadership position when the party leader and senior officials are elected in 2012.
"He can basically do anything he wants and the party can't or won't throw the book at him," said Mark Schroeder, southern Africa analyst at global intelligence company Stratfor.
"You need to keep him to counter any threat from Cosatu or the SACP. You need some other capability and the ANC Youth League has that capability."
Both Vavi and SACP leader Blade Nzimande have presidential ambitions, sources within the alliance say.
Analysts said it was still unlikely that Cosatu would go it alone, pointing to the dismal performance of ANC breakaway, The Congress of the People, since last year's elections.
"If they tried to break away they wouldn't have a chance. They would probably have to wait at least another election cycle," Stratfor's Schroeder said.